BURNETT FACES ITS FUTURE (PART 2/3)

"In the end, creative people are measured by their reel," said a creative executive at a rival Chicago agency, and with clients such as Reebok and Miller

Lite gone, some are more inclined to leave.

Aiming to rebuild morale, Burnett has made optional its Creative Review Committee-a grueling process of reviewing new creative that dates back to Mr. Burnett.

Ms. Berman, the creative chief, has been working to reduce bureaucracy, and-in perhaps the biggest shift-Chicago-centric Burnett is hiring creatives from outside that city and allowing some to work in New York and other places.

Those are welcome changes,

said the rival creative, adding that Burnett has tended to "choke the process a bit."

Mr. Krinsky noted while Burnett once ruled the Midwest, now marketers have greater creative options in the region. United, for example, hired Fallon McElligott in Minneapolis, as did Miller. More recently, McDonald's returned its primary creative assignment to DDB Needham Worldwide, Chicago.

QUESTIONS ABOUT LEADERSHIP

The McDonald's move raised questions about the leadership of the creative department. At the time of the late July reassignment, Mr. Fizdale circulated a memo to Burnett employees that didn't mention a loss, instead carrying the headline "McDonald's splits assignments" and focusing on the fact Burnett kept kids and teen business as well as selected international work.

But also noted by people was the absence of Ms. Berman's name in the memo, which thanked "last week's pitch team."

That was a team headed by Ms. Berman, cited as being the heart and soul of McDonald's advertising over the years as well as the driving force behind memorable creative for Hallmark Cards and others.

Although Mr. Fizdale's memo said that "I was extremely proud to be a part of their brilliant effort," the CEO was actually "beside himself" over the disorganization of the pitch, according to an executive close to McDonald's. Burnett had every one of its creative teams, including the team that handles Philip Morris' Marlboro cigarette brand, work on the pitch, but it ran long, was too scattered and offered too many options, said this executive and others familiar with the shoot-out.

Partly as a result, there is believed to be growing tension between Ms. Berman and Mr. Fizdale.

"Somebody's got to pay for McDonald's and Rick [Fizdale] will find a way to make it her," said a former Burnett creative on the business.

A WARNING

Just this month, rumors were floating that TBWA Chiat/Day Chief Creative Officer Lee Clow had been offered Ms. Berman's job. Mr. Clow denied the rumors, but competitors took them as a warning signal to Ms. Berman.

A spokesman for Burnett denied any such problems within the agency or with clients, noting, "Cheryl has many fans in Oak Brook," McDonald's world headquarters.

Still, Burnett last week announced the hiring of Joe McCarthy, former global ad director at Nike, as a part-time consultant on creative.

Problems in that department had been expected to disappear when Burnett suddenly and uncharacteristically cleaned its management decks last April, ousting President-CEO William Lynch and Vice Chairman-Chief Operating Officer James Jenness after only 15 months. The ouster returned the CEO title to Chairman Mr. Fizdale, who had been slated to retire after 29 years with the company.

In explaining the drastic, uncharacteristic action, a Burnett spokeswoman said "priorities were a little skewed" under Messrs. Lynch and Jenness toward finance. Even though the pair made huge contributions to profits, Burnett officials said it sometimes came at the expense of morale and the creative process.

Mr. Lynch, who still works from an office in Burnett's headquarters at 35 W. Wacker Drive, declined comment.

DEEPER REASONS

But some close to Burnett said that even though Messrs. Lynch and Jenness seemingly violated the founder's admonishment never to "spend more time making money and less making our kind of advertising," the reason for Mr. Lynch's dismissal may run deeper.

Former staffers maintain there was tension between Mr. Lynch-a stalwart Catholic who brought in the Chicago Archdiocese as a client-and Mr. Fizdale, who was undergoing a very public divorce with his wife Mara, an exec VP-executive creative director at Burnett who had worked closely with Mr. Jenness on the Kellogg account.

Mr. Lynch, an account manager, rose to power on the strength of client Kellogg; Mr. Fizdale, the former creative chief, on the strength of Philip Morris.

"They were definitely left brain and right brain," said a staffer.

Ironically, the mini-agency approach Burnett is now adopting is similar to the brand team restructuring put in place by Messrs. Lynch and Jenness in 1995. That structure created brand teams including client service, creative, production, media and planning, and gave each brand team profit-and-loss responsibility.